Dana Gas reports a 5.6% drop in net profit to $151 million for 2024 due to a one-time impairment charge
UAE-based energy company Dana Gas said on Friday that its net profit for 2024 fell by 5.6% to $150.6 million (AED 553 million). This drop was mainly because of a one-time $33 million (AED 121 million) charge in Egypt for past costs from old agreements.
Financial Performance
- Without the one-time impairment, Dana Gas made a net profit of $183.5 million (AED 674 million) in 2024, which is 15% higher than the previous year.
- The company’s total revenue for the year increased by 5%, reaching $443.8 million (AED 1.63 billion), compared to $422 million (AED 1.55 billion) the year before. This growth mainly came from better financial terms under a new concession agreement in Egypt, as stated in its earnings report.
- Dana Gas reported a total cash balance of $315.8 million (AED 1.16 billion), including $234.4 million (AED 861 million) at Pearl Petroleum. The company’s total debt is $254.6 million (AED 934 million).
- Total payments received by Dana Gas in 2024 rose to $326.7 million (AED 1.2 billion), compared to $238 million (AED 872 million) in 2023. Additionally, the company received $133 million (AED 488 million) in dividends from Pearl Petroleum.
- In September 2024, Dana Gas partnered with UK-based climate tech company Levidian to test LOOP technology. This technology converts methane into high-quality graphene and hydrogen. A pilot project is planned for 2025 to see how it can help lower greenhouse gas emissions.
- In the last quarter of 2024, Dana Gas’ revenue jumped by 64% to $158.7 million (AED 583 million), up from $96.9 million (AED 356 million) in the same period of 2023. This increase was due to extra revenue from the new concession deal in Egypt. Net profit for the quarter grew by 15% to $38.9 million (AED 143 million) due to higher earnings and lower financing costs.
CEO’s Statement
Dana Gas CEO Richard Hall said, “The new concession agreement in Egypt has allowed us to start our planned investments, and we see many opportunities under this new deal.”
He also mentioned that the company is considering resuming sustainable dividend payments to shareholders while focusing on improving operations, innovation, and partnerships in the Kurdistan Region of Iraq (KRI) and Egypt for long-term growth.
KM250 Project
In September 2024, Pearl Petroleum took full control of the KM250 expansion project after ending its contract with the original contractor. The project is expected to start producing gas by mid-2026.
Once operational, KM250 will increase gas processing capacity by 250 million standard cubic feet per day (MMscf/d), boosting the company’s revenue and overall financial performance.
Production and Growth
Dana Gas’ average daily production fell by 7% to 54,850 barrels of oil equivalent per day (boepd) in 2024, down from 58,700 boepd in 2023. This decline was mainly due to a 25% drop in Egypt’s output to 16,450 boepd, caused by natural field depletion. However, production in the KRI grew by 4%, reaching 38,400 boepd in 2024, up from 36,900 boepd in 2023.
New Concession Deal in Egypt
By the end of 2024, Dana Gas signed a new deal with Egypt’s Ministry of Petroleum & Mineral Resources and the Egyptian Natural Gas Holding Company (EGAS). This deal combines its existing concessions into one, adding 297 sq. km of exploration area and improving financial terms. These changes will make operations more efficient and attract more investments.
Under this agreement, Dana Gas will invest $100 million in development and exploration, including drilling 11 new wells. This investment aims to slow down production decline and increase gas recovery by 80 billion cubic feet. The higher gas supply is also expected to save Egypt over $1 billion by reducing its need for imported liquefied natural gas (LNG) and fuel oil for power generation.
Published: 10th February 2025
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